County of Douglas v. Nebraska Tax Equal. & Rev. Comm.
296 Neb. 501
| Neb. | 2017Background
- TERC issued show-cause orders after the PTA’s statewide equalization report recommended adjustments to three residential valuation areas in Douglas County (Areas 2, 3, and 4).
- PTA’s sales-ratio analysis showed medians: Area 2 = 104.82% (above statutory 92–100%), Area 3 = 89.77%, Area 4 = 90.08% (both below range); overall county median = 92%.
- PTA recommended increasing Areas 3 and 4 by 7% and leaving Area 2 unchanged, citing skew from many low-value sales; TERC voted to increase Areas 3 and 4 by 7% and decrease Area 2 by 8%.
- Douglas County (through Chief Field Deputy Baines) contested the sales-file reliability and the appropriateness of blanket equalization—arguing problems (high COD, PRD, sales verification failures, possible sales-chasing) required reappraisal, not equalization.
- After the hearing, Douglas County moved to reconsider, submitting an affidavit alleging the state included county-designated non-arm’s-length sales and misallocated sales among valuation areas; TERC denied reconsideration 2–1.
- Nebraska Supreme Court reversed TERC’s order as to Area 2 (finding it arbitrary and unsupported) and affirmed the increases for Areas 3 and 4 and denial of the motion to reconsider.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether TERC lawfully decreased Area 2 valuation by 8% | Douglas County: decrease unsupported; data show extreme dispersion (COD 48.43) and regressive vertical inequity (PRD 1.22); equalization cannot fix nonuniformity—reappraisal required | TERC/PTA: median > statutory range; adjustment needed to achieve acceptable level | Reversed as to Area 2—TERC’s decrease arbitrary and unsupported; reappraisal, not blanket equalization, required for dispersion/vertical inequity |
| Whether TERC lawfully increased Areas 3 and 4 by 7% | Douglas County: sales-file unreliable (sales verification failures, possible sales-chasing) so PTA’s statistics shouldn't control | TERC/PTA: quality statistics (COD near/within range; narrow 95% confidence intervals entirely outside 92–100%) support reliable medians and adjustment | Affirmed—TERC’s increases supported by competent evidence and not arbitrary |
| Whether TERC abused discretion by denying Douglas County’s motion to reconsider | Douglas County: new affidavit shows PTA used county-designated non-arm’s-length sales and misallocated sales to wrong areas; TERC should have reopened record | TERC: AVU is not the vehicle for sales-categorization; county could have raised discrepancies at hearing; affidavit did not show impact on medians | Affirmed—TERC did not abuse discretion in denying reconsideration; county’s allegations were untimely and lacked proof of material impact |
Key Cases Cited
- County of Douglas v. Nebraska Tax Equal. & Rev. Comm., 262 Neb. 578, 635 N.W.2d 413 (2001) (background on TERC equalization authority and standards)
- Douglas County v. Archie, 295 Neb. 674, 891 N.W.2d 93 (2017) (standards for reviewing TERC decisions and administrative evidence)
- State v. Cerritos-Valdez, 295 Neb. 563, 889 N.W.2d 605 (2017) (definition of abuse of discretion)
- State v. Bellamy, 264 Neb. 784, 652 N.W.2d 86 (2002) (procedural discussion of reconsideration and agency authority to revisit decisions)